With the development of genetic engineering techniques, it has become possible to study the expression of specific genes and to pinpoint the DNA sequences involved in gene regulation. The transcription of cloned cukaryotic genes in vitro has been most extensively studied with genes transcribed by RNA polymerase III. These include the genes coding for 5S RNA, tRNA and several viral encoded small RNAs. The 5S RNA genes of the frog Xenopus form a developmentally regulated multigene family with different members expressed in oocytes and in somatic cells. Initiation of transcription of these genes in vitro is preceded by the assembly of the template DNA into stable DNA-protein complexes. These stable active transcription complexes exist in vivo on active 5S genes. Chromatin assembled in vitro in the absence of these protein factors is transcriptionally inert. Similarly, the developmentally repressed oocyte-5S genes reside in an inactive chromatin structure in somatic cell nuclei. The propagation of these stable active and inactive transcription complexes through many cycles of DNA replication and cell division may be a crucial element in cellular differentiation. Identification of the protein factors which comprise these complexes and elucidation of the mechanisms whereby these factors direct accurate transcription are the major aims of this proposal.